Received an FTA assessment, penalty notice, or audit finding? Essence is an FTA-registered tax agency (TAN 30006266) specialising in VAT and Corporate Tax dispute resolution — reconsideration applications, TDRC appeals, penalty waivers, and audit representation across the UAE.
You have only 20 business days from the date of an FTA decision to file a reconsideration application. Missing this window forfeits your right to challenge the decision at the reconsideration stage. If you have received an FTA assessment, penalty notice, or adverse ruling — contact Essence today. Do not wait.
From penalty notices to multi-million dirham VAT assessments — Essence handles all categories of UAE tax disputes with the FTA.
The FTA has issued an additional VAT assessment claiming more tax is owed. Common grounds for dispute include incorrect input tax denials, wrong treatment of exempt or zero-rated supplies, misapplication of the partial exemption method, or errors in the FTA's calculation. Essence reviews the assessment, builds the technical argument, and files the reconsideration.
As UAE Corporate Tax matures, CT assessments and disputes are increasing. Common issues include taxable income calculation disagreements, rejection of small business relief elections, free zone qualifying income disputes, and transfer pricing adjustments. Essence prepares CT dispute submissions backed by the correct technical and legal arguments.
FTA penalties range from AED 500 to millions of dirhams. Many are issued for technical or procedural violations with no actual tax loss. Essence prepares penalty waiver and reduction applications based on reasonable cause, first-offence status, good faith, and voluntary cooperation — with a strong track record of penalty reduction.
FTA auditors frequently deny input tax credits on business expenses, claiming they relate to exempt supplies, are blocked under the VAT law, or lack sufficient documentation. Essence challenges incorrect denials by establishing the business purpose of expenses and the correct VAT treatment under UAE law.
The FTA rejects or delays VAT refund claims for various reasons including documentation gaps, risk profiling, or incorrect refund calculations. Essence reviews rejected refund claims, addresses the FTA's specific concerns, and files a reconsideration or supplementary documentation to recover the refund.
When the FTA selects your business for a tax audit, Essence manages the entire process — organising records, drafting responses to information requests (within 5-business-day deadlines), attending FTA meetings, and challenging any incorrect findings before they become formal assessments.
The FTA dispute resolution process has three escalating stages. Essence manages each stage strategically — building the strongest possible position before escalating.
A formal written request asking the FTA to review and overturn their own decision. This is the mandatory first step — you cannot go directly to the TDRC without first attempting reconsideration. Essence drafts the legal and technical arguments, compiles supporting evidence, and submits within the deadline. The FTA must respond within 20 business days.
File within 20 business days of FTA decisionIf the FTA's reconsideration decision is unfavourable, the case escalates to the independent Tax Disputes Resolution Committee. The TDRC reviews the merits of the dispute independently of the FTA. Essence prepares detailed written submissions and represents the client at TDRC hearings. The TDRC can uphold, reduce, or fully overturn the FTA's assessment or penalty.
File within 20 business days of reconsideration decisionIf the TDRC ruling is still unsatisfactory, the case can be escalated to the UAE Federal Courts. Court proceedings involve formal legal representation and can address questions of law as well as fact. Essence coordinates with qualified UAE legal counsel for Federal Court proceedings while continuing to provide full tax technical support.
Statutory court filing deadlines applyA voluntary disclosure is a proactive submission correcting errors in previously filed tax returns — before the FTA discovers them through audit. Filing voluntarily avoids the full audit penalty framework and demonstrates cooperation.
Penalties for errors discovered by FTA auditors are significantly higher than those for proactive voluntary disclosures. If you suspect an error in a past return, the safest action is always to disclose promptly. Essence assesses each situation and advises on the optimal approach — including whether voluntary disclosure is appropriate or whether a different strategy better protects your position.
Understanding what penalties are at stake helps you assess whether professional dispute resolution is worth pursuing. Spoiler: it almost always is.
| Violation | FTA Penalty | Challengeable? | Our Approach |
|---|---|---|---|
| Late VAT return filing (first time) | AED 1,000 | Yes | Reasonable cause application — system errors, illness, first-time offence |
| Late VAT return filing (repeat) | AED 2,000 | Yes | Reconsideration with evidence of corrective measures taken |
| Late VAT payment | 2% monthly surcharge | Yes | Penalty waiver based on banking errors, reasonable cause, or first offence |
| Tax evasion | Up to 5x tax evaded | Yes | Establish absence of intent, factual correction, voluntary disclosure |
| Failure to issue tax invoice | AED 5,000 per invoice | Yes | Demonstrate corrective action taken and systemic controls now in place |
| Incorrect tax invoice | AED 5,000 per invoice | Yes | Show good faith error correction and no tax loss to government |
| Late CT registration | AED 10,000 | Yes | First-time waiver application with evidence of prompt correction |
| Late CT return filing | AED 500–20,000 | Yes | Reasonable cause, first-time offence, no prior penalties on record |
| Failure to maintain records | AED 10,000 (first); AED 50,000 (repeat) | Yes | Evidence that records exist, challenge the FTA's characterisation |
TAN 30006266 — legally authorised to represent clients directly before the FTA and TDRC. Not just advisors — registered agents with standing to act on your behalf.
Winning disputes requires both deep UAE tax law knowledge and clear written advocacy. Our team is ACCA and CTA qualified with hands-on FTA dispute experience.
Dispute deadlines are strict and unforgiving. We respond to new instructions within 24 hours and can file emergency reconsideration applications at short notice.
We evaluate your dispute position before you commit to any fees. If we don't think we can help, we tell you honestly rather than taking your money and hoping for the best.
Dispute resolution is often the result of gaps in ongoing compliance. Essence offers the full range of UAE tax services to keep you compliant and dispute-free.
The 20-business-day deadline to file a reconsideration is non-negotiable. Essence provides a free initial case assessment — we evaluate your dispute position, advise on strategy, and act fast to protect your rights before deadlines expire.
